Mixed price trends were observed in regional square billets markets in September. In the Gulf states and China, prices fell by the end of the month. Prices for Russian square billets in the Black Sea region and on the Turkish market rose; however, in the former case, the quotations were nominal: there was no actual trading due to the impossibility of physical exports.
In September, the square billet market shifted from gradual growth to stagnation. At the start of the month, prices continued to rise against a backdrop of positive expectations regarding demand, particularly in Asia, as well as increases in the cost of scrap and other raw materials.
By mid-September, growth had slowed: sentiment in Asia had deteriorated, although prices in Turkey remained relatively stable thanks to the high cost of scrap. Limited supply of billets in the short term provided further support to the market. In the second half of the month, trading activity fell significantly: market participants adopted a wait-and-see approach ahead of the extended public holidays in China.
By the end of September, no clear price trend had emerged: prices had largely stabilised, whilst attempts at further increases failed to gain sufficient traction. The main market drivers remained the cost of square billets, the demand situation for steel and scrap, limited supply, and expectations regarding Chinese demand.
The Russian billet export market is undergoing a significant reorganisation of logistics routes, and costs are rising. Due to security risks, the Black Sea region is effectively closed to regular shipments. In the Black Sea market for square billets (Black Sea FOB), average prices rose by $11 in the first half of September, reaching $470/t.
As exports via the Black Sea are no longer possible, suppliers are being forced to reroute shipments via ports in the Baltic and the Far East. Sellers are almost entirely abandoning the FOB Novorossiysk basis and switching to sales on CFR terms (Turkey, the Middle East, North Africa, Asia). At the same time, the shift of cargo flows to the Baltic increases logistics costs and delivery times: grain shipments are given priority on the railways and receive freight discounts, which complicates the transhipment of steel and increases the cost of its transport.
In September, the Turkish square billet market went from a marked rise in prices to a virtual standstill in trading. In the first half of the month, prices rose against a backdrop of higher scrap and rebar prices, improved sentiment in the Chinese market and limited supply. Rising prices for finished rolled steel enabled Turkish billet producers to raise their offer prices, whilst imports from Asia were sporadic. However, by 23 September, activity in both the domestic and import markets had virtually ground to a halt due to a slowdown in rebar trade and a wait-and-see attitude amongst buyers.
The rise in prices for Turkish rebar (notably, a $20/t increase by Kardemir) offsets the rise in freight costs and maintains the economic viability of importing billets. Furthermore, domestic billet production in Turkey rose by 0.7% in January–August, reaching 15.9 million tonnes.
Overall, trends in the Turkish market were driven primarily by prices for scrap and rebar, the state of domestic demand and the availability of imported billets. By the end of the month, prices had stabilised following a rise in the first half of September. The average price of square billets on Turkey Ex-Works terms rose by $30/t in September to $575/t.
The market for Chinese semi-finished products imported into the ASEAN region saw stagnation and low trading activity. At the end of September, Chinese exporters effectively withdrew from the South-East Asian market due to ‘Golden Week’ (until 7 October) and pre-holiday logistics. A price gap persisted between sellers and buyers: mills did not lower their quotations due to high costs, whilst overseas buyers refused to pay more against a backdrop of weak demand and a correction in coking coal futures. Quotations for Chinese 3sp 150 mm coking coal fluctuated between $465 and $478 per tonne and settled above $470 per tonne FOB by the end of September.
The main factors influencing the market in September were:
The domestic market in China (Tangshan) saw a downward trend and low trading activity. According to Kallanish, average prices for square billets in Tangshan fell by $4 in September to $444/t.
Supply increased in September: mills were keen to free up funds ahead of the festive season and were selling semi-finished products rather than finished rolled steel. Demand from rolling mills remained weak, whilst stocks of billet in Tanshan were rising. Substantial stocks of rolled steel forced rolling mills to operate intermittently or to shut down production facilities.
In export markets (ASEAN), activity was held back by adverse weather conditions (typhoons, rain), which slowed down construction work, and a wait-and-see attitude on the part of buyers.
Prices for billet in the Gulf states are characterised by high volatility due to the complex geopolitical situation, which affects logistics, the availability of square billets and other factors. According to Kallanish, average feedstock prices in the region fell by $34 to $501/t (CFR) at the end of September, following a rise of $28/t in August.
As previously reported, the National Bank of Ukraine (NBU) expects that, by the end of 2026, the average price of steel billets will rise by 4.9% year-on-year — to $487.7/t on FOB Ukraine terms. According to the forecast, in 2027 and 2028 the price will stand at $510.4/t (+4.7% year-on-year) and $518/t (+1.5% year-on-year) respectively.
Courtesy : https://gmk.center/en